While working for Shell Oil during the 1940′s Dr. M. King Hubbert noticed the production of crude oil from individual oil fields plotted a normal bell shaped curve. Roughly half of the oil from a field has been exhausted when the bell curve peaks.

Carrying that insight further he surmised that oil production from a group of oil fields would follow a similar bell shaped pattern.

In 1956 Dr. Hubbert predicted the cumulative group of oil fields within the US would reach peak production in the 1970′s, and thereafter decline – no matter how much money would be thrown at exploration and development of reserves US oil production would not rise higher after this date – his prediction was uncannily accurate.

There are a few things we can learn from studying oil production on the upside slope of Hubbert’s bell curve.